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Philip Morris International Inc. on March 22 further reduced its diluted EPS outlook for fiscal 2019 after its Canadian subsidiary secured creditor protection amid a class-action lawsuit in Quebec.

The New York-based tobacco maker now expects diluted EPS for fiscal 2019 to be at least $4.90 from its previous outlook of at least $5.28, which was already lowered from the initial forecast of $5.37. The latest forecast, however, still represents an 8% increase in adjusted diluted earnings per share of $4.84 in 2018, Philip Morris said in a release.

The revision comes after Philip Morris' Canadian unit Rothmans Benson & Hedges Inc., or RBH — along with British American Tobacco PLC-owned Imperial Tobacco Canada Ltd. and Japan Tobacco Inc.'s JTI-Macdonald Corp. — lost an appeal in two lawsuits filed in 1998 by people who claim to have developed lung diseases after smoking cigarettes manufactured by the three companies.

The litigation could cost the tobacco makers C$15.6 billion in damages. Analysts have said it could also potentially lead to bankruptcy.

Philip Morris decided to deconsolidate its Canadian subsidiary from its financial statements after the unit was granted creditor protection under Canada's Companies' Creditors Arrangement Act, or CCAA. The law allows financially troubled companies to operate as usual while it seeks to restructure its business.

The tobacco giant expects the deconsolidation of RBH from its financial statements to result in an estimated one-time non-cash charge of approximately 10 cents per share, to be recorded in the first quarter of 2019, plus the tobacco litigation-related charge of approximately 9 cents per share announced March 4.

In addition, RBH will be excluded from Philip Morris' consolidated financial statements from the date of the deconsolidation to Dec. 31. The move is expected to result to a charge of approximately 28 cents per share, Philip Morris said.

The company said RBH is not expected to pay any dividends amid the ongoing court case. The unit has not paid dividends since the trial court's judgment in May 2015.

Philip Morris added that the deconsolidation of RBH is not expected to have an impact on the group's current annualized dividend rate. The tobacco company said its 2019 to 2021 targets, announced Feb. 7, remain unchanged.

Ernst & Young Canada Inc. has been appointed as monitor in RBH's CCAA proceedings.